Nowadays people are considering cryptocurrencies as investment options like Real Estate, Stocks, Gold, etc.
Cryptocurrency may turn out to be your best investment, but investing in crypto has become a nightmare for those who have been scammed with it.
Some smart minds develop amazing technologies. Alternatively, some bad-minded people find ways to fool people and steal their hard-earned money with those technologies.
A report shows that over 45,000 people have fallen into cryptocurrency scams in the past year.
Every year people lose thousands in crypto scams, but our readers shouldn’t lose a dime, that’s why we are here with this article. In this post, you will learn about some common crypto scams so that you can avoid falling into them.
Let’s see what are those common crypto scams that people face:
4. Rug Pull Scam
This is one of the most dangerous crypto scams. In this scam, scammers make cryptocurrencies, when people invest in those scam cryptos, the scammers simply abscond with the investor’s money.
You must be thinking that how is this scam so dangerous, and how do people get into this scam? Well, scammers are greedily tricking people, they create cryptocurrencies in the name of some trending and popular things.
Seeing the name of some trending thing on crypto, people get excited and buy scam crypto, this increases the price of scam crypto even more.
Looking at the rapidly rising price, more people are attracted to scammers’ cryptocurrency and buy it with the lure of profit in a short time.
People’s greed makes them cry. Crypto scammers stop trading options for scam cryptocurrencies after people invest in their scam crypto, which means that they make people unable to sell the crypto coins they have purchased.
One of the most recent examples of this scam is the Squid Game Coin scam which was named after the super hit Netflix drama “Squid Game”.
Scammers created this squid coin when there was a lot of hype about the web series. Many people bought Squid Crypto, and as a result, the price per token of Squid Crypto rose by 1 cent to over $2,500, but the token price dropped to $0 after a few minutes.
Some squid game web series fans invested over $1,000 in that crypto but lost all their money. Scammers stole over $3 million from the public with squid coins.
3. Phishing scams
The phishing scam is one of the oldest tricks used by scammers to steal money from people.
In this scam, scammers send emails pretending to be a professional company or a popular website, something that can trick a person into believing that the email is genuine.
The email sometimes contains a downloadable malicious file or link that takes the victim to the scammer’s website. Here scammers try to steal your personal information which can give them access to your crypto exchange accounts or wallet.
The scamming technique sounds simple but in this scam most of the people lost their money at the hands of scammers.
To avoid falling into these types of scams, never download a file by email when you think there’s only a little something wrong with it.
Also, never enter your personal information if you visited a website via email, no matter how professional that website may be. Always check the website URL before entering any information, try to visit websites from search engines. Sometimes scammers even copy the look of popular company websites.
Many scammers have also stolen bank account information from people in the past using this phishing scam technique. Once the scammer gets the vital information of a person then that person is definitely robbed.
2. Crypto Exchange Scams
Many people get fooled by this type of scam. Scammers trick people with fake crypto exchanges or imitate a similar look to popular crypto exchange sites.
Sometimes scammers offer free bitcoins for victims to register on their fake exchanges. Once the victim is registered on the exchange they wouldn’t be able to transfer that BTC to another wallet and the fake crypto exchange will ask to pay some transfer fee if the victim tries to do so. When people pay the transfer fee, scammers easily steal it.
These fake exchanges will ask for money at every step; They just try to take the money out of the victim’s pocket somehow.
Another way scammers use is that they imitate the exact look of popular crypto exchanges. This is a bit daunting for many scammers but some evil minds manage to make it work.
While copying the exact look of popular exchange scammers can fool many innocents, you can imagine how dangerous this can be.
To avoid falling into this trap one should check the crypto exchange URL properly before trading, users should visit the exchange website through the search engine, and never visit any site through spam ads.
1. Ponzi schemes
Ponzi scheme also known as a pyramid scheme is a very common scam among people. This scam technique is one of the oldest, you must have seen this scam happening in many different areas.
Scammers are leaving no stone unturned to dupe people. This scam works like this: you buy a cryptocurrency now you have to hold it and ask your friends to buy the same cryptocurrency and you will be rewarded, ask your friends to buy crypto and get people and now both you and your friend will get rewarded. The reward is nothing but the same cryptocurrency, you will get a few more coins as a reward. Sounds great and easy to earn money, doesn’t it?
Soon when the scammer gets enough investors, the thief simply runs away with the money of you, your friend, and other buyers.
One such scam is “Pi Coin” where they are asking people to download their mobile app. They say that crypto mining is possible with the phone and that you can mine their Pi coins using their app on your phone.
Also, they ask people to refer the app to their friends. All you need to do to mine crypto is keep open their app “Pi Network” running in the background. Experts say that this app is a Ponzi scheme, they just steal people’s data to sell it.
Conclusion
First of all, I am very thankful that you gave your valuable and important time to this article.
There were some negatives in this article and you may not feel like buying any cryptocurrency now after reading this article. But let me tell you that all cryptos are not scams and bad, crypto technology is an amazing technology and this is the future. You can trust it.
But remember to do your best research possible on the crypto, never invest in anything blindly. You should know everything about crypto before investing.
Control your greed and invest wisely in cryptocurrency, then you can definitely make a good profit from cryptocurrencies.
[Disclaimer: The content of this article is not intended as financial advice, and should not be construed as such. Neither readaboutcrypto.com nor the author is responsible for any investment decision made by any reader.]